Commentary on the Mortgage Law
The passage of the Mortgage comes at a much needed point in the development of the Saudi real estate and housing markets. The Law sets a foundation for the market's future development. The possibilities are indeed exciting - from more product choice for home buyers to the eventual development of a secondary market.
Now that the law has passed it will be critical for effective regulations to be established. Our recent comment on the need for balanced, enforceable regulation was printed on July 7th in the Arab News and Al-Sharq Al-Awsat and have been included below for your review.
We welcome your thoughts and comments.
Capitas Group International
|The Mortgage Law: Systematic Implementation Needed (Arab News, July 7, 2012)|
The passage of the mortgage law in Saudi Arabia is a much-awaited milestone for the country's real estate and housing markets. The law will pave the way for a broader home ownership and healthier real estate market overall, bringing the Kingdom to a level playing field with other countries and securing the growth and stature of the Saudi market globally.
The possibilities now available in the market are extremely exciting, from a broader choice of financing products to the development of a viable secondary market and more. But the passage of the law will not flip a magic switch that automatically opens floodgates of home financing, turning renters into homeowners. Nor will it secure the rights of borrowers and financers in a single day. Once the dust settles, the Mortgage Law can only deliver on its long-term objective of increasing homeownership through systematic implementation.
The first step in implementation requires the law to be transformed into effective regulations and enforcement mechanisms.